France approves 75% tax on millionare income
ARTICLE SOURCE: BKIINBERG,com
By Rudy Ruitenberg - Dec 29, 2013
French President Francois Hollande received approval from the country's constitutional court to proceed with his plan to tax salaries above 1 million euros at 75 percent for this year and next.
Under Hollande's proposal, companies will have to pay a 50 percent duty on wages above 1 million euros ($1.4 million). In combination with other taxes and social charges, the rate will amount to 75 percent of salaries above the threshold, the court wrote in a decision published today.
"The companies that pay out remuneration above 1 million euros will, as expected, be called upon for an effort of solidarity on remuneration paid in 2013 and 2014," the Economy Ministry said in an e-mailed statement.
Hollande, who once said he "didn't like" the rich, announced the 75 percent tax in February 2012 as part of his presidential campaign to appeal to his Socialist base. It has become a symbol of his government’s record-high taxation rate.
A first proposal to put the change into law was turned down by the constitutional court in December last year because the tax applied to individuals and not households. The country’s top administrative court said any rate above 66 percent would be rejected as confiscatory.
Hollande revived the plan this year, making it apply to salaries and be paid by employers rather than individuals. The total amount is limited to 5 percent of a company’s revenue.
The court examined the proposed tax after more than 60 members of parliament and more than 60 senators filed their opposition, it said.